The recent January 2015 regulatory changes in the U.S. – Cuba relations will no doubt encourage future business and investment opportunities between these two countries. However, for the time being there will continue to be assorted operating challenges and compliance issues to deal with for general aviation (GA) operators.

The following is an overview of what you need to know:

1. U.S. sanctioned countries

Many countries are currently under sanctions to U.S.-registered aircraft. These policies range from comprehensive sanctions set by the U.S. government to various Federal Aviation Administration (FAA)-imposed airspace restrictions. Currently, Cuba and Iran are under the most comprehensive U.S. sanctions. Other nations with different types of sanctions include Syria, North Korea, Sudan, Iraq, Somalia, Russia and Ukraine (sanctions on individuals and certain industries) and Myanmar (sanctions on banking).

2. Small first steps in easing restrictions

Restrictions related to U.S. sanctioned countries do not change frequently and, in the case of Cuba, have been in place for more than 50 years. However, certain small changes and requirement relaxations came into effect on January 16, 2015. Further changes may be anticipated over the long term, but such information is unknown at this time.

3. Current Cuba sanctions

Even though some regulatory changes have occurred, Cuba still remains heavily sanctioned. There are still payment issues to consider, as many U.S. banks aren’t yet facilitating payments directly to Cuba even though regulations permit it for services incident to travel. The Office of Foreign Asset Control (OFAC) maintains many requirements for certain U.S. nationals, or resident persons, to obtain specific licenses if these persons don’t meet the general license criteria (see section 6). Also, currently U.S. nationals and residents are prohibited from traveling to Cuba for tourism purposes.

4. January 2015 changes

In the past all U.S. nationals and residents were required to obtain specific OFAC licenses in order to travel to Cuba. This has changed somewhat as of January 16, 2015. It is no longer necessary to obtain a specific license to travel to Cuba if you fit one of the 12 qualifying categories described in Part 515.560(a) of the Cuban Asset Control Regulations (CACR). U.S. persons are now generally licensed to engage in travel listed in 515.560(a) if they satisfy the specific requirements of the CACR. A general license doesn’t require approval from OFAC, but you must be able to demonstrate compliance with the requirements of each general license. In addition you’ll need to have a complete detailed itinerary on whom you’re meeting with and why – religious, humanitarian or qualified business purposes, etc. This information must be readily available in case OFAC requests proof that the passenger is qualified to travel under a general license.

5. U.S. Travel Service Provider (TSP) limitations

U.S. Travel Service Providers (TSPs) no longer require specific OFAC licenses to assist with providing services incident to travel to Cuba. For example, if a U.S. national or resident is traveling to Cuba, under a general license, U.S. TSP can now arrange all associated services incident to travel. For qualifying flights to Cuba, U.S. service providers are able to arrange, and make payment for all services incident to travel including items such as local transportation, hotel accommodations, ground handling, fuel uplifts, in-flight catering and airport fees. If you’re unsure if the service you require is or is not covered it’s best to confirm this with TSP.

6. Cuban Overflight Permits

Overflying Cuba is of particular interest to many business aircraft operators. It’s important to understand that at the time of this article being published there have been no changes to the Cuban overflight process. See our previous article Understanding Cuban Overflight Permits for more information on the current process.

7. Authority to travel to Cuba under a general license

Qualified passengers are no longer required to obtain specific licenses from OFAC, but rather are authorized to travel to Cuba under a general license, if they satisfy all of the requirements of the general license noted in the regulations. These changes are outlined in section 515.560. Below is a list of the 12 types of travel eligible for a general license:

Family visit

Official business of the U.S. government, foreign governments, and certain intergovernmental organizations

Journalistic activity

Professional research and professional meetings

Educational activities

Religious activities

Public performances, clinics, workshops, athletic and other competitions, and exhibitions

Support of the Cuban people

Humanitarian projects

Activities of private foundations or research or educational institutes

Exportation, importation, or transmission of information or informational materials

Certain export transactions that may be considered for authorization under existing Department of Commerce regulations and guidelines with respect to Cuba or engaged in by U.S.-owned or –controlled foreign firms

If your travel to Cuba does not satisfy the general license requirements outlined in the CACR, the passenger is required to obtain a specific license from OFAC before traveling to Cuba or engaging in travel-related transactions.

It’s also important for operators to review 15 CFR part 740.19 for an outline of what may and may not be transported into Cuba and 15 CFR part 746.2, which outlines the Cuba embargo.

9. Temporary sojourn licenses

Operators of private non-revenue U.S.-registered civil aircraft may be required to obtain a temporary sojourn license from the Commerce Department’s Bureau of Industry and Security (BIS) for operations to Cuba under license exception Aircraft and Vessels (AVS). Specifically, some exports of U.S.-owned civil aircraft may qualify for the license exception outlined in 15 CFR Section 740.15.

10. Additional considerations

Mandatory U.S. departure and return entry points flights all to/from Cuba remain in place. Upon arrival in Cuba the aircraft and crew is only permitted to drop and go and may not remain in country. Current approved list of qualifying airports that U.S.-operators may use when departing to/returning from Cuba is:

Conclusion

While these early steps in normalization of business, investment and travel between the U.S. and Cuba are enticing for operators, don’t expect changes or regulation relaxation to progress quickly. As of January it’s become a little easier, and more straight-forward, for travel to Cuba, but it will likely be many years before business aviation operations become significantly eased.

Please note that this article and the materials available herein are for informational purposes only and not for the purpose of providing legal advice. You should contact your attorney to obtain legal advice before operating any travel to Cuba.

Questions?

If you have any questions about this article or would like information on U.S. sanctions, contact me at kathyself@univ-wea.com.

Kathlynn L. Self is the Director of Corporate Compliance and Internal Audit for Universal Weather and Aviation, Inc. where she provides advice and recommendations concerning regulatory compliance assessments and internal audits. In her previous role, Kathlynn served as the Manager of Corporate Compliance where she managed and implemented international compliance initiatives and training programs. Having been with Universal for twelve years and in a Compliance role for the last four plus years, Kathlynn has extensive experience with compliance and international business issues and is a speaker on subjects such as the Foreign Corrupt Practices Act (FCPA), global anti-bribery, business ethics, economic sanctions, export controls, anti-boycott, policy management and the like. Before entering the compliance and audit spectrum, Kathlynn also served in a number of business and legal (non-attorney) roles prior to her work as a Director. Kathlynn holds memberships with the Society of Corporate Compliance and Ethics, the Association of Certified Fraud Examiners, the Institute of Internal Auditors, The Houston Chapter of InfraGard, the Ethics & Compliance Officers Association and the Greater Houston Business Ethics Roundtable. Kathlynn is a Certified Compliance and Ethics Professional, and is currently pursuing a Master of Science in Business Ethics & Compliance with a concentration in Forensic Accounting from the New England College of Business and Finance and can be reached at kathyself@univ-wea.com.